Quantitative Scoring Engine v5.1 — 1 Ticker
| Ticker | Price | Verdict | Conviction | Score | Base Target | Upside | Fortress |
|---|---|---|---|---|---|---|---|
| APP | $603.00 | YES | 8/10 | 7.5 | $720 | +19% | Good |
Overall: ALL PASSED
| Gate | Detail |
|---|---|
| ✓ G1 Price Data | $603.00 |
| ✓ G2 Market Cap | Market Cap: $202.57B |
| ✓ G3 Price History | 252 trading days (min: 100) |
| ✓ G4 Options | Options available (16 expirations) |
| ✓ G5 Delisting | No delisting signals |
| Factor | Weight | Raw Value | Score (0–10) | Contribution |
|---|---|---|---|---|
| Revenue Growth | 25% | 59.0% [consistent] MEASURED | 10.0 | 2.500 |
| Gross Margin | 15% | 88.4% [+1.3pp YoY] MEASURED | 10.0 | 1.500 |
| Operating Margin | 15% | 78.2% [+2.1pp YoY] MEASURED | 10.0 | 1.500 |
| Fcf Yield | 10% | 1.6% (growth adj) MEASURED | 5.9 | 0.585 |
| Roic | 15% | ROA=44.2% (ROIC fallback) MEASURED | 10.0 | 1.500 |
| Debt Health | 10% | ND/EBITDA=0.2x, ICR=24.1x, CR=3.24 MEASURED | 9.6 | 0.960 |
| Earnings Trajectory | 10% | EPS(T)=11.53, EPS(F)=21.93, Fwd=+90% MEASURED | 8.0 | 0.800 |
| 7/7 factors have data (100%) — No coverage penalty Pillar score: Raw: 9.35 → Adjusted: 9.35 | Composite contribution: 9.35 × 0.40 = 3.740 | 3.740 | |||
| Factor | Weight | Raw Value | Score (0–10) | Contribution |
|---|---|---|---|---|
| Trend Alignment | 25% | above 50-DMA, above 200-DMA, death cross, ADX=22 (trending) MEASURED | 7.0 | 1.750 |
| Mean Reversion | 25% | RSI=73 (overbought), %B=129 (near upper band) MEASURED | 0.0 | 0.000 |
| Momentum | 20% | MACD above signal, histogram positive, ROC=36.0% (strong up) MEASURED | 8.2 | 1.640 |
| Positioning Sentiment | 20% | SI=4.1% (moderate), P/C=0.67 (bullish sentiment) MEASURED | 5.8 | 1.160 |
| Volume Confirmation | 10% | RVOL=0.6x MEASURED | 5.0 | 0.500 |
| 5/5 factors have data (100%) — No coverage penalty Pillar score: Raw: 5.05 → Adjusted: 5.05 | Composite contribution: 5.05 × 0.15 = 0.757 | 0.757 | |||
| Factor | Weight | Raw Value | Score (0–10) | Contribution |
|---|---|---|---|---|
| Iv Richness | 35% | 72% MEASURED | 9.7 | 3.410 |
| Iv Vs Hv | 10% | IV/HV=1.11x MEASURED | 7.5 | 0.750 |
| Beta Gap Risk | 10% | 2.37 MEASURED | 8.0 | 0.800 |
| Gap History | 10% | Worst day: -19.7%, >5% drops: 22 MEASURED | 2.0 | 0.200 |
| Capital Outlay | 5% | $60,300 per 100 shares MEASURED | 7.0 | 0.350 |
| Entry Timing | 10% | LEAPS available MEASURED | 5.5 | 0.550 |
| Options Liquidity | 20% | near-term OI 11,229 (good), LEAPS OI 5,114 (~384d, good), spread 11% (moderate) MEASURED | 7.5 | 1.500 |
| IV Source: IBKR Live 7/7 factors have data (100%) — No coverage penalty Pillar score: Raw: 7.56 → Adjusted: 7.56 | Composite contribution: 7.56 × 0.30 = 2.268 | 2.268 | |||
| Factor | Weight | Raw Value | Score (0–10) | Contribution |
|---|---|---|---|---|
| Forward Pe | 30% | 27.5x MEASURED | 5.0 | 1.500 |
| Peg Ratio | 20% | 1.32 MEASURED | 6.0 | 1.200 |
| Ev Ebitda | 20% | 39.4x MEASURED | 4.0 | 0.800 |
| Analyst Upside | 15% | +6.9% to $644 MEASURED | 5.2 | 0.778 |
| Ps Or Pb | 15% | P/S=32.9x (asset-light) MEASURED | 4.5 | 0.675 |
| 5/5 factors have data (100%) — No coverage penalty Pillar score: Raw: 4.95 → Adjusted: 4.95 | Composite contribution: 4.95 × 0.15 = 0.743 | 0.743 | |||
| Pillar | Score | Weight | Contribution |
|---|---|---|---|
| Fundamentals (40%) | 9.35 | 40% | 3.740 |
| Technicals (15%) | 5.05 | 15% | 0.757 |
| Fortress Fit (30%) | 7.56 | 30% | 2.268 |
| Valuation (15%) | 4.95 | 15% | 0.743 |
| Composite Score | 7.51 | ||
| Field | Value | Source |
|---|---|---|
| Price | 603.0 | yfinance/IBKR |
| Market Cap | $202.57B | yfinance |
| IV (IBKR) | 72.3% | IBKR live |
| IV (yfinance) | 72.4% | yfinance options |
| HV 30d | 65.2% | computed |
| Beta | 2.366 | yfinance |
| Revenue Growth | 59.0% | yfinance |
| Gross Margin | 88.4% | yfinance |
| Operating Margin | 78.2% | yfinance |
| FCF | $3.18B | yfinance |
| ROE (ref) | 266.4% | yfinance |
| ROA (ref) | 44.2% | yfinance |
| Total Equity | N/A | yfinance |
| D/E Ratio | 162.89 | yfinance |
| Current Ratio | 3.24 | yfinance |
| EPS Trailing | 11.53 | yfinance |
| EPS Forward | 21.93 | yfinance |
| Earnings Growth | 113.1% | yfinance |
| Fwd P/E | 27.50 | yfinance |
| PEG Ratio | 1.32 | yfinance |
| EV/EBITDA | 39.38 | yfinance |
| P/S Ratio | 32.86 | yfinance |
| P/B Ratio (ref) | 85.80 | yfinance |
| Analyst Target | $644.4667 | yfinance |
| Near-term ATM OI | 11,229 | ~45d chain |
| LEAPS ATM OI | 5,114 | ~384d chain |
| Near-term Spread % | 10.9% | ~45d chain |
| Has LEAPS | Yes | yfinance |
| Next Earnings | 2026-08-06 | yfinance |
| Worst 1-Day Drop | -19.7% | price history |
| >5% Drop Days | 22 | price history |
| RSI 14 | 72.8 | computed |
| MACD | 24.51 | computed |
| ADX 14 | 21.70 | computed |
| Relative Volume | 0.55 | computed |
| 52W High | $745.61 | yfinance |
| 52W Low | $320.0 | yfinance |
| 1Y Return | +54.5% | yfinance |
The scoring engine delivers a strong YES verdict (8/10 conviction) driven primarily by exceptional fundamentals (9.3/10) that more than offset stretched valuation metrics. AppLovin's operational excellence is undeniable: 59% revenue growth with expanding margins (88.4% gross, 78.2% operating), stellar returns (44.2% ROA), and pristine balance sheet health. The forward earnings trajectory shows 90% EPS growth potential, justifying premium multiples in a high-growth mobile advertising market. While valuation appears rich at 27.5x forward P/E and 39.4x EV/EBITDA (5.0/10 score), the 1.32 PEG ratio suggests growth rates can support current levels. Technical momentum remains constructive (8.2 momentum score) despite overbought conditions. The Fortress Fit score of 7.6/10 benefits from exceptional IV richness at 72%, though gap risk from high beta (2.37) and volatile price action requires careful structure sizing.
APP exhibits mixed technical signals with strong underlying momentum but stretched near-term positioning. The stock maintains bullish trend alignment above both 50-day and 200-day moving averages with ADX confirming a trending environment. However, RSI at 73 signals overbought conditions while Bollinger %B at 129 indicates price extension beyond normal ranges. MACD remains constructively positioned above its signal line with positive histogram, supporting the 36% rate of change momentum. Immediate support levels sit at 595 and 546, with resistance clustering around 677-737. The death cross pattern warrants monitoring, though it conflicts with other trend indicators.
| Scenario | Price Target | Timeline | Rationale |
|---|---|---|---|
| Bear | $450 | 12-18 | Multiple compression amid growth deceleration or increased competition in mobile advertising, with high beta amplifying any market downturn. |
| Base | $720 | 12-15 | Sustained execution on current growth trajectory with modest multiple expansion as market recognizes earnings quality and margin sustainability. |
| Bull | $900 | 15-24 | AI-driven advertising optimization creates deeper competitive moats while international expansion accelerates, driving sustained 40%+ growth rates. |
The primary concern is valuation vulnerability given premium multiples across all metrics. Any growth disappointment or margin pressure could trigger significant multiple compression, amplified by the stock's 2.37 beta. The mobile advertising space faces increasing competition from major tech platforms and potential privacy regulation headwinds. Additionally, the company's heavy reliance on mobile gaming advertising creates concentration risk if that vertical weakens. Technical risks include the current overbought positioning and significant gap-down history (worst single day -19.7% with 22 drops exceeding 5%). High implied volatility, while beneficial for income generation, reflects market uncertainty about sustainability of current growth rates.
AppLovin scores well for Fortress structures (7.6/10) primarily due to exceptional IV richness at 72%, providing substantial premium collection opportunities. Options liquidity is adequate with 11,229 near-term open interest and 5,114 LEAPS contracts, though 11% spreads require careful execution. The $60,300 capital requirement per 100 shares is manageable for sophisticated portfolios. However, the 2.37 beta and documented gap risk (22 significant drops) necessitate conservative position sizing and robust downside protection.
Disclaimer: This report is auto-generated for informational purposes only. Verdicts and conviction scores are computed by a deterministic quantitative scoring engine (4-pillar model with hard gates). Narrative sections are generated by Anthropic Claude and may contain errors. Fundamental data from Yahoo Finance. IV data from IBKR (where available) or Yahoo Finance options. All data subject to delays. Options trading involves substantial risk. Always do your own due diligence.